UPDATE 1-Keller Group profit rises on US construction demand

Mon Aug 4, 2014 5:08am EDT

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Aug 4 (Reuters) - Keller Group, a ground engineering contractor, said first-half pretax profit rose 21 percent as underlying growth in the U.S. construction market, its biggest in terms of revenue, continued.

The company's shares rose as much as 3 percent, making the stock one of the top percentage gainers on the FTSE-250 index on Monday morning.

The company, which lays cost-effective foundations for infrastructure, industrial, commercial and residential projects, said like-for-like first-half order book for work to be executed over the next 12 months was 9 percent ahead of the start of the same time last year.

"We see current levels as an attractive entry point for a stock with continued significant earnings momentum ahead, on a continued recovery in its core end markets," Investec analyst Andrew Gibb said in a note to clients.

Pretax profit rose to 32.5 million pounds ($54.7 million) for the six months ended June 30 from 26.8 million pounds a year earlier. Revenue rose 22 percent to 788.2 million pounds.

Keller, which laid the foundations for London's Olympic stadium, generates 49 percent of its total revenue from North America.

The company's foundations offerings include piling and earth-retention systems and ground improvement techniques such as soil mixing.

Keller last week said it had made an exceptional provision of 30 million pounds in the first half related to a contract dispute on a project completed by its UK unit Keller Ltd.

The company said it was vigorously defending the claims made.

Shares in the company were up 3 percent at 901 pence at 0906 GMT on the London Stock Exchange. ($1 = 0.5941 British Pounds) (Reporting by Aashika Jain in Bangalore; Editing by Gopakumar Warrier)

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